A recent decision by the federal Fourth Circuit Court of Appeals (states of MD, WV, NC, SC, VA) offers an interesting discussion of the test for federal maritime jurisdiction and, specifically, the issue of identifying the navigable waters of the United States.
The case involved a lawsuit over damage to a submerged electric cable owned by Baltimore Gas & Electric Company (BG&E) that was struck by a barge owned by Coastal Commercial Contracting, Inc., which homeowners along Eli Cove had hired to extend their residential pier. BG&E filed a tort suit in federal district court, invoking the Court’s admiralty jurisdiction.
How does a court determine whether it has admiralty jurisdiction to hear a dispute involving an alleged maritime tort?
We have a two-part test from the U.S. Supreme Court. The test considers 1) the location of the wrongful act and 2) the connection to and the effect the wrongful act may have on maritime commerce. The alleged wrong must occur on or over a navigable waterway of the United States, and it must bear a significant relationship to traditional maritime activity. This is referred to as the “location plus” test (Jerome B. Grubart, Inc. v. Great Lake Dredge & Dock Co., 513 U.S. 527 (1995)).
The district court found that the incident on Eli Cove did not meet the location plus test for the purposes of admiralty jurisdiction and dismissed the lawsuit because it did not have subject matter jurisdiction. On appeal for de novo review, the Fourth Circuit reversed the district court’s jurisdictional ruling. It found that Eli Cove is a navigable waterway and that the Court has admiralty jurisdiction.
The first question is whether the location of the incident is a navigable waterway of the United States.
This issue goes all the way back to the founding period of U.S. history when it was recognized that national uniformity in maritime matters was vital. We have the case of The Daniel Ball, 10 Wall 557, 19 L.Ed. 999 (1871), in which the U.S. Supreme Court stated: “(Rivers) are navigable in fact, when they are used, or susceptible of being used, in their ordinary condition, as highways of commerce, over which trade and travel are or may be conducted … and they constitute navigable waters of the United States, in contradistinction from the navigable waters of the State, when they form in their ordinary condition by themselves, or by uniting other waters, a continued highway over which commerce is or may be carried on with other states or foreign countries.”
This so-called “navigable in fact” test means that the water at the site of the injury must carry, or be capable of carrying, cargo in interstate or international commerce or must join up with other waters that carry or are capable of carrying cargo in interstate or international commerce.
There are a variety of different definitions of “navigable waters” under different statutes and from different federal agencies, but the key for federal tort jurisdiction (and for cases arising under the Longshore and Harbor Workers’ Compensation Act and the Jones Act) is use (or potential use) in interstate or international commerce.
Did the federal Court have subject matter jurisdiction in a case involving an incident on Eli Cove?
Let’s look at navigability first, since if the water is not “navigable” then we don’t need the rest of the test for federal jurisdiction. The district court found that Eli Cove was a ‘residential inlet” separate from but allowing access to Stoney Creek (which flowed into the Patapsco River and then into Chesapeake Bay and the Atlantic Ocean). The Court found that Eli Cove was not being used for commercial activity because, among other reasons, it was too shallow to support commercial navigation.
NOTE: The district court cited language from an earlier Fourth Circuit case to the effect that if a waterway is navigable due to its association with other waters that are regarded as navigable, “… then there is scarcely a creek or stream in the entire country which is not a navigable water of the United States”.
The Fourth Circuit disagreed with the district court’s analysis on the navigability of the Cove. It first observed that Eli Cove is part of the tidal waters of the Chesapeake Bay, and tidal waters have long been recognized as navigable for purposes of admiralty jurisdiction.
NOTE: The boundary of admiralty jurisdiction in tidal areas does not ebb and flow with the tide. Navigability extends to the mean high-water mark.
The Fourth Circuit found that the fact that many of the properties abutting Eli Cove were residential is not relevant. Current use may be residential only, but if the waterway is capable, or “susceptible,” of commercial navigation, then it is “navigable waters.” The Court observed that, “One could push off from the Cove and travel along an uninterrupted route to the Bay to reach Virginia and on to the Atlantic Ocean.”
The Court concluded that current use does not determine navigability. Waters used exclusively for recreational navigation may be capable of commercial navigation.
NOTE: The Fourth Circuit stressed the need for national uniformity in maritime matters, but curiously chose as a central point of its reasoning an issue where other Circuits may differ. We address that part of the discussion in Part Two of this blog series.
Eli Cove is “navigable”. What about the second part of our two-part test?
Did the incident in which the cable was damaged have a potentially disruptive effect on maritime commerce, and did it have a substantial relationship to traditional maritime activity?
In the opinion of the Fourth Circuit damage to an underwater electric cable produces a dangerous situation potentially involving risks of fire and explosion. Such a disruptive incident would require the intervention of the Coast Guard and other commercial vessels. The fact that there was no actual disruption to maritime commerce as a result of this incident did not matter. There was the potential for disruption.
As to traditional maritime activity, the Fourth Circuit found that the transportation of a barge full of tools and construction materials was the “epitome” of traditional maritime activity.
The Court made the interesting comment that although Eli Cove was generally a residential inlet, it was lined with “commercially built piers.”
NOTE: BG&E had requested a permit to lay the cable back in 1986 from the U.S. Army under the Rivers and Harbor Act of 1899, and Section 4 of the Clean Water Act, and Section 13 of the Marine, Protection, Research, and Sanctuaries Act. These laws require permits authorizing activities in or affecting navigable waters.
The Court pointed out that the Army’s opinion as to the navigability of a body of water could be instructive but was not dispositive. The Courts have their own test. The case was remanded back to the district court for further proceedings.
NOTE: On December 15, 2024, the U.S. Supreme Court declined to grant a writ of certiorari to review the matter, so the case of Eli Cove stands as the Fourth Circuit’s latest position on the issue of navigable waters of the United States.
In its expansive ruling, the Fourth Circuit stated, “A jurisdictional rule that required courts to assess the residential-ness versus the commercial-ness (along the length of a waterway) … would be unworkable and generate a patchwork of state law jurisdiction and admiralty law jurisdiction along the same body of water.
In Part Two we will consider cases from other federal circuits on the issue of navigability. Spoiler alert: We do not have national uniformity.
